Spot cotton quotations averaged 185 points lower than the previous week, according to the USDA, Agricultural Marketing Service’s Cotton Program. Quotations for the base quality of cotton (color 41, leaf 4, staple 34, mike 35-36 and 43-49, strength 27.0-28.9, uniformity 81.0-81.9) in the seven designated markets averaged 81.24 cents per pound for the week ended Thursday, May 3, 2012. The weekly average was down from 83.09 cents last week and 155.31 cents reported the corresponding period a year ago. Daily average quotations ranged from a high of 82.56 cents on Friday, April 27 to a low of 80.68 cents on Monday, April 30. Spot transactions reported in the Daily Spot Cotton Quotations for the week ended May 3 totaled 5,736 bales. This compares to 8,116 bales last week and 10,514 bales reported a year ago. Total spot transactions for the season were 840,308 bales, compared to 591,796 bales the corresponding week a year ago. The ICE July settlement prices ended the week at 89.21 cents, compared to 92.11 cents last week.
USDA ANNOUNCES SPECIAL IMPORT QUOTA #12 FOR UPLAND COTTON May 3, 2012
The Department of Agriculture’s Commodity Credit Corporation announced a special import quota for upland cotton that permits importation of a quantity of upland cotton equal to one week’s domestic mill use. The quota will be established on May 10, 2012, allowing importation of 14,594,057 kilograms (67,030 bales) of upland cotton.
Quota number 12 will be established as of May 10, 2012, and will apply to upland cotton purchased not later than August 7, 2012, and entered into the U.S. not later than November 5, 2012. The quota is equivalent to one week’s consumption of cotton by domestic mills at the seasonally-adjusted average rate for the period May 2011 through July 2011, the most recent three months for which data are available.
Future quotas, in addition to the quantity announced, will be established if price conditions warrant.
Weekly Cotton Market Review Prices are in effect from May 4-10, 2012
Adjustment World Price (AWP) 77.33 ELS Competitiveness Payment 0.00 Loan Deficiency Payment (LDP) 0.00 Fine Count Adjustment 2011 Crop 0.00 Coarse Count Adjustment (CCA) 0.00 Fine Count Adjustment 2012 Crop 0.08 Source: Farm Service Agency, FSA, USDA
Spot cotton trading was slow. Supplies were moderate. Demand was moderate. Producer offerings were light. Average local spot prices were lower. Trading of CCC-loan equities was inactive.
Portions of North Carolina and Virginia received around one-quarter to one inch of beneficial precipitation early in the week. Fieldwork was getting back underway in Virginia following a pattern of unseasonably cool weather which had delayed planting. Hot, dry conditions prevailed in Alabama and Georgia with daytime temperatures in the mid-80s to low 90s. Producers had scaled back or halted planting activity entirely in central and north Alabama, due to droughty conditions and hard soils. Producers ran full irrigation schedules in Georgia. A period of soaking rainfall was desperately needed to alleviate expanding drought conditions. Local experts in Georgia and North Carolina reported that pressure from thrips was building in early planted fields with emerging seedlings. Producers considered weed management strategies as herbicide-resistant palmer amaranth (pigweed) was already emerging and flowering in areas across the region.
South Central Markets
Spot cotton trading was inactive. Producer offerings and supplies were light. Demand was light. Average local spot prices were lower. Trading of CCC-loan equities was inactive. No forward contracting was reported.
Above-average temperatures, dry, and windy conditions depleted topsoil moisture in some areas. Producers in the Bootheel of Missouri delayed planting in anticipation of rain showers to provide sufficient moisture to promote good seed germination. The delay, coupled with high grain prices, particularly for soybeans, could shift even more acres from cotton than previously estimated. Planting was estimated at 50 percent completed in Arkansas, 33 in Missouri, and just underway at 6 percent in Tennessee.
Spot cotton trading was inactive. Supplies were moderate. Producer offerings were light. Demand was light. Average local spot prices were lower. Trading of CCC-loan equities was inactive. No forward contracting was reported.
Although some producers delayed planting due to dry conditions, other growers in Mississippi made excellent progress and moved well ahead of the fiveyear average, 39 percent currently compared to 17 percent historically. Planting in Louisiana jumped to 50 percent completed compared to a five-year average of 44 percent for this time of the year. Local experts reported that high input costs and lower ICE futures prices have dampened enthusiasm for cotton throughout the region, and that reductions in cotton acreage could exceed current expectations.
Spot cotton trading was slow. Supplies were moderate. Demand was light. Average local spot prices were lower. Producer offerings were light. Forward contracts were offered, but few producers signed. Trading of CCC-loan equities was inactive. No domestic mill activity was reported. Foreign mill interest was light. In the Blackland Prairies, planting neared completion under mostly clear and warm conditions. Producers in south Texas and the Rio Grande Valley irrigated cotton fields. In Kansas, rainfall was received in all cotton-growing areas followed by abundant sunshine with temperatures in the 90s. Some producers had begun to plant, while most waited for more rainfall. In northern Oklahoma, beneficial moisture was received and fieldwork was active as producers prepared to plant seed.
Spot cotton trading was slow. Supplies were heavy. Demand was light. Average local spot prices were lower. Producer offerings were light. The December futures market remained under the 90.00 cents level, and few producers entered into contract agreements. Trading of CCC-loan equities was slow. Foreign mill interest was light.
The thunderstorms brought beneficial moisture of approximately 2-5 inches ahead of planting for the cotton-growing areas. Another storm front pushed through 24 hours later and deposited up to three inches of beneficial rainfall that helped to fortify the soil in the eastern part of the region. Planting and field preparation advanced in the northern High Plains and southern Low Plains under clear, sunny skies with daytime highs mostly in the 90s.
Desert Southwest (DSW)
Spot cotton trading was inactive. Supplies and demand were light. Average local spot prices were lower. No forward contracting or domestic mill activity was reported. Foreign mill inquiries were slow.
Cotton planting advanced without interruptions in the region. Local experts estimated that approximately 70- 75 percent of the crop was planted. The crop made good progress in Yuma, Arizona. Seedlings were emerging in central Arizona, New Mexico, and El Paso, Texas. No insect pressures were reported. No moisture was recorded in the period.
San Joaquin Valley (SJV)
Spot cotton trading was inactive. Supplies were moderate. Demand was light. Average local spot prices were lower. Producers inquired about contracting, but prices were not acceptable as ICE December futures remained in the mid-80 cents range. No domestic mill activity was reported. Foreign mill inquiries were slow.
Planting progressed under ideal weather conditions. Some producers had to remove hard-crusted soil caps to allow seedlings to emerge. Several hundred acres of cotton were re-planted in parts of Kern, Kings, and Tulare Counties, due to damage from heavy rains in early April. Organic plantings were completed. Seedlings were strong and healthy.
American Pima (AP)
Spot cotton trading was inactive. Supplies were moderate. Demand was light. Producer offerings were moderate. Average local prices were steady. Producers inquired about new-crop contracting, but no contracts were signed. Foreign mill inquiries were light. Shippers remain concerned about export cancellations.
Cotton planting advanced in the far west. Planting neared completion in Arizona. The crop made good progress in Yuma, Arizona. No insect pressures were reported. Ideal weather conditions and early irrigation water advanced planting in New Mexico and El Paso, Texas. Planting was active in the San Joaquin Valley (SJV). Local experts reported that some re-planting was done in Kern and Kings Counties. Excellent weather conditions the past two weeks helped the organic crop make good progress in the SJV.
Domestic mill buyers inquired for a light volume of color 41, leaf 4, and staple 33 for prompt fill-in needs. Additional inquiries were light; reports indicated most mills had covered their immediate-to-nearby raw cotton needs. Demand for polyester-cotton blended yarns remained good. The undertone from mill buyers remained cautious as some reported reduced operating schedules due to lackluster finished product sales.
Inquiries through export channels were moderate. Representatives from mills in China purchased a moderate volume of color 31, leaf 4, and staple 33 for May/June shipment. Demand continued to center around any discounted styles of cotton. Domestic exporters continued to report that foreign mill buyers were resistant to higher prices, but slightly lower ICE futures prices had enticed additional interest.
Regional Price Information
A moderate volume of color 31 and 41, leaf mostly 3 and 4, staple 34 and longer, mike 43-52, strength 29-32, and uniformity 80-82 sold for 400 to 500 points off ICE July futures, FOB car/ truck, Georgia terms (Rule 5, compression charges paid, 30 days free storage).
A moderate volume of color 41 and better, leaf 2-4, staple 35-38, mike 35-49, strength 29-31, and uniformity 80-82 sold for around 175 points off ICE July futures, same terms as above.
A light volume of color 41 and better, leaf 5 and better, staple 35 and longer, mike 35-54, strength 28-32, and uniformity 79-83 traded at around 84.00 cents per pound, FOB car/truck (Rule 5, compression charges paid).
No trading activity was reported.
In Texas, a moderate volume of color 31 and better, leaf 3 and better, staple 35, mike averaging 42.9, strength averaging 29.6, and uniformity averaging 80.4 sold for around 92.50 cents per pound, FOB car/truck (compression charges not paid).
In Oklahoma, a light volume of mostly color 41, leaf 4, staple 36, mike 37-41, strength 30-31, uniformity 80-81, with 75 percent bark sold for around 78.00 cents, same terms as above.
A light volume of mixed lots of color mostly 41 and 42, leaf 2 and 3, staple 33 and 34, mike 41- 46, strength 28-30, uniformity 79-81, and 75 percent bark sold for around 75.65 cents, same terms as above.
A light volume of CCC-loan equities traded for around 23.00 cents.
A light volume color 22 and 32, leaf 2 and better, staple 35 and longer, mike 40-42, strength 27- 31, and uniformity 78-82 sold for around 80.00 cents per pound, FOB car/truck (compression charges not paid).
A light volume color 12 and 22, leaf 2 and better, staple mostly 31, mike 40-48, strength 22-28, and uniformity 77-80 sold for around 75.00 cents, same terms as above.
A light volume of mixed color mostly 21 and 31, leaf 3 and 4, staple 37 and longer, mike 29-31, strength 29-32, uniformity 79-81, and 75 percent bark sold for 71.50 to 72.50 cents, same terms as above.
A light volume of 2010-crop cotton of mostly color 53, leaf 5, staple 34, mike 38-42, strength 27- 29, uniformity 79-81 and 50 percent bark sold for around 67.00 cents, same terms as above.
A light volume of CCC-loan equities traded for 22.00 to 27.00 cents.
The average offered price for 2012 bale contracts was 400 to 500 off December for color 31, leaf 3, and staple 36 with variations for further discounts for low micronaire and extraneous matter.
No trading activity was reported.
San Joaquin Valley
A light volume of 2012-crop cotton was contracted early in the reporting period.
A moderate volume of color 2 and better, leaf 2 and better, and staple 46 and longer was sold to domestic mills for May delivery.
Southwestern Markets cont.
Forward contracting of 2012-crop cotton. Upland cotton growers in the United States had booked about 9 percent of their expected acreage by the end of April this season. This was below the 26 percent booked through the same period last year. Contracting has been most active in the south central states where about 29 percent of the crop was under contract by the end of April and compares with 64 percent a year earlier. Southeastern states’ growers had forward contracted about 10 percent, compared with 31 percent in 2011. Southwestern states’ growers had contracted about 2 percent of the crop, compared to 14 percent last year. Growers in the western states had 4 percent of the crop under contract and compares with 3 percent contracted at the end of April last year. These estimates were based on the National Agricultural Statistics Board’s March Prospective Plantings report and informal surveys made by the USDA, Agricultural Marketing Service, Cotton Program.